Nvidia Stock Rises. Why AI Spending Fears Are Fading.

Nvidia chips are the favored choice for training artificial-intelligence models. (David Paul Morris/Bloomberg)

Nvidia stock was gaining early Wednesday. The chip maker looked to be benefiting from a confident outlook on artificial-intelligence investment from cloud-computing company Oracle .

Nvidia shares were up 4.3% at $178.03 in early trading. They rose 1.5% on Tuesday.

The gain was broadly in line with other AI-exposed stocks after Oracle said it finished its August quarter with $455 billion in total remaining performance obligations, or contracted revenue it expects to collect, up more than fourfold from the same quarter a year earlier.

That rise was largely attributable to major deals for computing infrastructure to support AI technology, which should mean continued heavy spending on processors from the likes of Nvidia. Among other chip makers, Advanced Micro Devices was up 2.9% and Broadcom gained 6.9% in early trading.

Oracle expects $35 billion in capital expenditures in its fiscal 2026 year. William Blair analyst Sebastien Naji said plenty of that money should be going on Nvidia’s graphic-processing units, or GPUs.

“The vast majority of [Oracle’s] capex is related to short-term assets (GPUs, servers, networking). This less capital intensive approach also allows it to stand up supply in sync with demand. We view this increased capex investment as broadly positive for AI suppliers, with Nvidia…likely to see outsized benefits,” wrote Naji in a research note.

Write to Adam Clark at adam.clark@barrons.com